Penn State Hershey, Pinnacle to fight effort to stop merger

Written by Ben Allen, General Assignment Reporter | Dec 17, 2015 2:31 PM

Photo by Ben Allen/witf

(Harrisburg) -- Penn State Hershey Medical Center and PinnacleHealth, two major health systems in the midstate, plan to challenge a bid to stop their merger.

They argue joining together will allow patients to get the best possible care at the lowest possible cost.

Both groups declined requests for an interview.

The Federal Trade Commission and state Attorney General's office recently filed documents in federal court to stop the merger.

In court documents, the FTC and AG's office say the merger is illegal by a wide margin - arguing it would push prices up.

They say because of the current competition between Penn State Hershey and Pinnacle, commercial insurers often threaten to exclude one health system from their network in order to get lower rates.

But if Penn State Hershey and Pinnacle win the case, the FTC says they would control nearly 65 percent of the health care market.

The next closest competitor - Holy Spirit Hospital in Cumberland County - has about 15 percent of the market.

Jeff Johnson, a spokesman for the state Attorney General Kathleen Kane, says the office stands by the position itlaid out in our filing, and it's prepared to look out for the best interests of consumers in the greater Harrisburg area.

Penn State Hershey and Pinnacle haven't actually filed a response to the FTC and state Attorney General yet.

Once they do, a court hearing will be scheduled.

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